Dean Baker: The Economy Is Awful and Larry Summers Should Not Be Fed Chair

In his recent defense of Larry Summers President Obama appeared to be badly confused about the state of the economy. This apparently leads him to believe that the country should be grateful to Larry Summers for his successes, as opposed to furious at him for his failures.

Obama’s story is that the economy was in a free fall when he took office and the program that was in large part designed by Summers helped turn it around. While it is true that the economy was in free fall, there was no reason to expect that to continue regardless of what policies were pursued. Note that in every single wealthy country the sharp drop in output at the end of 2008 and the beginning of 2009 was stopped and reversed by the end of the year. Other countries were not able to rely on the genius of Larry Summers in setting their policies.